The most obvious reason is that for the most part, we're not legally required to have it. You can't drive without auto insurance and you can't carry a mortgage on a house without homeowners insurance. But unless you have some individual legal obligation (eg. child support/divorce), you don't have to have life insurance.
Life insurance is also an uncomfortable subject. Nobody likes to think about death. And selfishly, many people don't want to pay for something that's not going to benefit them personally. "I'll be dead, what do I care?" And at one time, I felt the same way.
Until a couple months ago, when my father died unexpectedly. And I was not ready - psychologically or financially. He did not have life insurance and now I not only had to deal with the loss of a family member, but also was stuck with a bill.
Death is the ultimate game-changer. The loss of life has a ripple effect on everyone even remotely attached to the deceased - but especially the immediate family. How would your death affect the people around you?
Here are some of the considerations and expenses to think about when it comes to your life insurance needs:
- Final Expenses - funeral and medical bills
- Loss of Income - will my family be able to support themselves without me?
- Debt - mortgage, credit cards, loans
- Education - can my children afford college without me?
- Legacy - donation to church or charity, family inheritance
